Posted by: karmapa September 26, 2004
Fighting Globalization in Nepal?
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Maximus, I find it difficult to argue with people who use escape clauses such as " i'm not an economist". Kinda like insecure students from college days venturing an answer in a classroom: "Well I may be wrong but I think...". Well if you find my debunking the word 'free' funny, you should, because it is so obvious but is often wrongly applied in policymaking. Don't worry: you are not alone in finding it funny, many charlatans with even MSc's in economics, and even policymakers, do. As a result, the country pays the price. Well certainly you have defined your understanding of 'free' trade quite correctly albeit ambiguously: you wrote: <> Free trade is ... trade between countries blah blah - well that's like saying a black hammer is a hammer painted black. Not useful. You have not defined ' trade' at all. "Free", because it's really such a misnomer and an ideal, is really hard to define. But anyway your subsequent paragraphs especially words like " importing", " transporting" and "selling" leads one to suspect that by free trade you probably mean 'free movement of goods and services between importing/exporting countries". well, that would be a very simplistic definition of free trade, if at all. any trade experts who do not use escape clauses like "I'm not an economist" like you do will tell you that movement of goods and services without government restrictions is only part of it. there are other issues like comparative advantages, fair competition, levelling the playing field, hidden subsidies, dumping, beggar thy neighbour policy (by willy nilly devaluing one's currency) to make one's exports more attractive, issue of 'enclave economy', issue of 'movement of natural persons', etc etc. free trade is more than just goods and services crossing borders without interference. if you think about it, barriers to movement of natural persons (embodiment of labor or 'human capital', and therefore of services) across countries such as requirements for visas, work permits, and passports are market distortions... so trade suffers majorly, but for a reason, mainly political. rethink 'free trade' the next time the American Consulate or whatever consulates refuse you visa. May be you won't find it very funny then. WTO is certainly dangling 'movement of natural persons' as a carrot to member developing countries...without going very far, but will probably use it only to exact concessions after concessions from the developing world... while i concede that 'free trade' is really an ideal and we are far from it (a global common market is what we need), if we chuck the notion of 'free' until then, we are much better off. 'free market' comes very close to the Austrian school of economic thought but is problematic; just calling market economy [which is usually of a mixed type] suffices.
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